Brazil PMI January 2019

Brazil: Manufacturing PMI edges up in January

February 4, 2019

Conditions in Brazil’s manufacturing sector improved at the start of 2019. The manufacturing Purchasing Managers’ Index (PMI) was rose from December’s 52.6 to 52.7, the joint-highest reading seen since March. The PMI lies above the crucial 50-threshold and in expansionary territory.

January’s healthy reading was driven by strong growth in new orders and output. New business was driven by solid domestic demand, while orders from abroad fell at the fastest pace in two years in part due to Argentina’s economic woes. In addition, business sentiment was upbeat, recording the best reading in the series’ history. Furthermore, improved dynamics translated into the labor market, and firms added jobs in January at the fastest pace since March. Meanwhile, input cost inflation continued to soften, in part due to the improvement in the real.

Brazil Industrial Production Forecast

The analysts surveyed by FocusEconomics for the LatinFocus Consensus Forecast see industrial production growing 3.2% in 2019, which is unchanged from last month's estimate. In 2020, industrial output is also expected to grow 3.2%.

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Brazil Economic News

Retail sales (excluding cars and construction) rose 1.0% from the previous month in seasonally-adjusted terms in July, which followed June’s revised 0.5% growth (previously reported: +0.1% month-on-month) and marked the best reading since November 2018.

Industrial production fell 0.3% month-on-month in seasonally-adjusted terms in July, which followed June’s revised 0.7% fall (previously reported: -0.6% month-on-month) and marked the third contraction in a row.

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